EU Commission Appeals Decision to Strike Down Ethanol Duty

Source: By Todd Neeley, DTN/The Progressive Farmer • Posted: Wednesday, August 31, 2016

The European Union Commission is appealing a court decision that was thought to have ended a 9.6% antidumping duty on ethanol imported from the United States. The duty has been based on what EU officials believed was the trade-distorting effects caused by the long-ago eliminated volumetric ethanol excise tax credit, or blenders credit.

The bad news for U.S. producers is the duty will remain in place during the appeals process.

On Nov. 25, 2011, the EU commission launched an investigation following a complaint by the European Producers Union of Renewable Ethanol Association. The group represents 25% of the EU’s total ethanol production.

The commission identified more than 60 U.S. producers who had exported ethanol to the EU between Oct. 1, 2010 and Sept. 30, 2011, when the blenders credit was still in play.

In February 2013 the European Union levied the antidumping duty on U.S. ethanol imports, in response to claims U.S. ethanol producers were undercutting EU producers. The duty essentially cut off U.S. exports to the EU.

In May 2013, Growth Energy and the Renewable Fuels Association filed a legal complaint against the EU’s action.

In June 2016 the EU General Court ruled the antidumping duty was invalid because the European Commission was required by EU law to give each sampled U.S. company its own antidumping rate. Instead, the European Union Commission applied a countrywide rate to all U.S. ethanol producers.

Before the antidumping duty was put in place, the European Union was an estimated 300-million-gallon market for U.S. producers.

“While not surprising, we are disappointed with EC’s decision,” Bob Dinneen, Renewable Fuels Association president and chief executive officer, said in a statement. “The antidumping duty should have never been assessed and is only hurting European consumers by shutting out the lowest-cost ethanol in the world. We will continue to fight to ensure the duty is removed.”

Emily Skor, chief executive officer of Growth Energy said in a statement: “The ongoing resistance of the EC is frustrating. Their willingness to continue to pursue an unprecedented, protectionist agenda will only delay the inevitable outcome, absolving U.S. ethanol producers from any false claims of antidumping. We will continue to pursue all options to fight this unfounded complaint and are confident we will be vindicated.”